Case Overview

• Court: Commercial High Court of the Western Province, Colombo 12
• Case Number: CHC/21/2018/IP
• Parties:
  • Plaintiff: A.M. Thusith Nirmala Abeykoon
  • Defendants:
    1. Sri Lanka Telecom PLC
    2. Sri Lanka Telecom (Services) Ltd.
• Presiding Judge: Hon. Pradeep Hettiarachchi
• Date of Judgment: November 11, 2024

Summary of the Case

The Plaintiff, A.M. Thusith Nirmala Abeykoon, alleged that the Defendants engaged in unfair competition by misappropriating confidential information related to a Power Strip with Lightning Surge and Over Voltage Protection device invented by the Plaintiff. The Plaintiff sought a range of reliefs, including injunctive orders, financial compensation, and declarations under Section 160 of the Intellectual Property Act, No. 36 of 2003.

The Defendants countered that they had obtained the device for technical investigations with no intent to infringe on the Plaintiff’s rights and asserted that the Plaintiff had failed to specify confidentiality restrictions or demonstrate the device’s originality.

Plaintiff’s Allegations

1. The Defendants forcibly opened the device, gaining access to undisclosed and confidential technical information.
2. The Defendants intended to utilize the Plaintiff’s intellectual property without consent.
3. The actions constituted unfair competition, violating honest trade practices as outlined in the Intellectual Property Act.

Defendants’ Defense

1. The device was provided for technical investigations, as indicated by the Plaintiff.
2. The Plaintiff neither imposed confidentiality restrictions nor provided written instructions regarding the scope of testing.
3. The device lacked originality, and similar designs existed in the market.
4. The Defendants are not involved in manufacturing or selling devices of this nature, negating any competitive relationship.

Key Issues Examined by the Court

1. Did the Plaintiff’s device contain confidential or proprietary information?
2. Did the Defendants act contrary to honest practices by opening the device?
3. Was the device’s design original or novel?
4. Did the Defendants engage in unfair competition as defined under the Intellectual Property Act?
5. Was the Plaintiff entitled to the reliefs sought?

Court’s Findings

1. Confidentiality and Proprietary Information

The court concluded that the Plaintiff failed to identify specific confidential information within the device. Despite claims of proprietary information, the Plaintiff did not impose written or verbal restrictions on the Defendants regarding the testing process. Furthermore, the Plaintiff’s patent application, submitted shortly after providing the device to the Defendants, entered the public domain and disclosed the device’s technical details.

2. Originality and Novelty

The court determined that the device lacked originality and did not exhibit novel or inventive features. Evidence presented by the Defendants demonstrated that similar products with identical or comparable technical attributes were readily available in the market. The Plaintiff also failed to substantiate claims of any unique technological advancements.

3. Honest Trade Practices

The Defendants’ actions were found to align with reasonable industry standards. They conducted necessary technical investigations to assess the device’s safety and functionality. The Plaintiff had neither restricted the scope of these investigations nor demonstrated that the Defendants acted dishonestly.

4. Unfair Competition

Under Section 160 of the Intellectual Property Act, acts constituting unfair competition must involve dishonest practices in the context of industrial or commercial activities. The court held that the Defendants did not manufacture or sell similar devices and did not engage in any activity that constituted unfair competition. The Plaintiff’s claims were speculative and unsupported by factual evidence.

5. Reliefs and Damages

The court dismissed the Plaintiff’s claims, citing insufficient evidence. The Defendants’ counterclaim for Rs. 100 million in damages was also rejected, as they failed to prove reputational harm. However, the Plaintiff was ordered to pay Rs. 750,000 in costs due to the frivolous and vexatious nature of the action.

Legal Principles Cited

1. Confidentiality:
   • Coco v. Clark [1969] RPC 41: A claim for breach of confidence requires the claimant to prove that the information was confidential, an obligation existed to maintain confidentiality, and the defendant breached this obligation.
   • Devon & Cornwall Autistic Community Trust v. Pyrah [2012] EWPCC 46: Lack of specificity in identifying confidential information can render a claim speculative and an abuse of process.
2. Originality and Inventiveness:
   • Windsurfing International v. Tabur Marine [1985] RPC 59: Determining inventiveness involves assessing whether the claimed invention differs significantly from existing knowledge and whether these differences are obvious to a skilled person in the field.
3. Unfair Competition:
   • Section 160, Intellectual Property Act: Actions contrary to honest practices in industrial or commercial activities constitute unfair competition. The Plaintiff must demonstrate dishonest intent or misuse of proprietary information.

Conclusion

The court’s judgment emphasized the Plaintiff’s failure to meet the burden of proof regarding confidentiality, originality, and dishonest practices. The Defendants’ actions were deemed appropriate within the context of technical investigations, and no evidence suggested unfair competition or misuse of the Plaintiff’s intellectual property. The dismissal of both the Plaintiff’s and Defendants’ claims underscores the importance of clear agreements, detailed documentation, and substantive evidence in intellectual property disputes.

Implications of the Judgment

1. For Innovators: Clear communication, confidentiality agreements, and comprehensive documentation are critical when sharing prototypes or intellectual property.
2. For Businesses: Conducting technical investigations within industry norms and documenting processes can protect against allegations of unfair competition.
3. For Legal Practitioners: The case highlights the evidentiary requirements for establishing claims of confidentiality, originality, and unfair competition under intellectual property law.

Read Full Judgement